Director-General of the Office for Attracting Strategic Enterprises, or OASES, Peter Yan King-shun is on Straight Talk this week.
Yan explains to us how his office has been driving strategically important investments to Hong Kong, and why it's crucial to the upgrading and transformation of our economy, and reports on OASES' success so far.
Check out the full transcript of TVB’s Straight Talk host Dr Eugene Chan’s interview with Peter Yan:
Chan: Good evening. This is Eugene Chan, and this week on Straight Talk, the Director General of the Office for Attracting Strategic Enterprises, or OASES, Peter Yan is with us to explore how Hong Kong is steering high potential and strategic investments to drive economic growth and innovation. Yan has over 39 years of experience in the technology industry, and has previously served as the CEO of the Hong Kong Cyberport Management Company Limited and SUNeVision Holdings Limited. Peter also brings extensive public service experience, having served on numerous advisory boards and councils, a distinguished fellow of the Hong Kong Computer Society. He is an alumnus of the Chinese University of Hong Kong and the Harvard Business School's Executive Education Programme. Welcome, Peter!
Yan: Thank you.
Chan: Peter, so the Office for Attracting Strategic Enterprises was a key initiative that our CE announced in his 2022 Policy Address to attract strategic enterprises from around the world.
Yan: Yes.
Chan: As the director-general, could you start by sharing with us what are OASES’ key objectives and how they align with Hong Kong's long-term vision for economic growth?
Yan: Right. Thank you, Eugene, for inviting me. OASES is set up because of the change. The world economy is now filled with uncertainties and there are a lot of challenges. So, we need a new approach in making sure that we maintain our leadership position in various industries, in particular the financial industry, and also various trade and logistics industries. We also need to diversify our economy so that we include more technology-related elements into existing established industry, as well as establishing technology as one of the key industry ourselves.
Chan: Peter, that means OASES is very important for Hong Kong's economic development from now on. I read that OASES focuses on attracting strategic enterprises in four industries in particular. Maybe you can elaborate on which four industries and why only these four, if not more.
Yan: Okay, as a start, we focus ourselves on four technology related areas, namely the artificial intelligence and data science area; secondly, life and health technology; thirdly, financial technology; and lastly, advanced manufacturing and new energy. Now, why AI and data science? Obviously, AI is now critical across different industry in elevating the productivity and also to embrace future development. So, this is something that we have to really embrace and further develop ourselves in enhancing existing industries that we have already established, as well as accumulating relevant talents for these areas and also to support other industry developments. For life and health technology, Hong Kong is a very strong medical center. You, being a doctor, definitely understand this, and we have a very strong branding, not just in Asia but also in the world for medical services. So, this is something that we can definitely leverage on to integrate more life and health technology into. Now, thirdly, for financial technology. Again, you know, we are an international finance center. We have to maintain our leadership in this area and incorporate more technology in the finance areas. And for new energy and also advanced manufacturing, this is a very fast growing and new area that have significant potential and impact a lot of future development. So, this is something that we also embrace and try to bring to Hong Kong and make sure that we have robust development on a long-term basis.
Chan: Peter, thank you for telling us which four industries are sort of the prime objectives. Now, say, down the road, will we be looking at other industries as well, or we've just mainly on this four, it's going to last us for the next decade?
Yan: As a starting point, I think, we definitely, in the near future, will be focusing on technology and for technology, if we look at the relatively promising and relevant industry to Hong Kong's already established economies and to further develop our innovation and technology industry. These are the four areas we probably will maintain for the immediate and medium term.
Chan: Right, I'm sure you have so called tailor-made facilitation …
Yan: Yes.
Chan: … measures to attract businesses to come to Hong Kong. Maybe you can elaborate on that. And what are the incentives, or actual support that you offer to these enterprises to come to Hong Kong?
Yan: Well, I think Hong Kong, ourselves have quite strong fundamental advantages to attract businesses to come to Hong Kong. Definitely, you know the “one country, two systems” has given us a lot of advantage over other competing economies. Yeah, we have a huge home market now. Particularly with the Greater Bay Area development, we have a significant market to cover our further development. And also, we have a long-established international network so that we can then help companies in the Chinese mainland to go out. These are the strengths that we already have. Now, on top of all these strengths, fundamental strengths that we have under the “one country, two systems”, we also have to be more proactive in developing further policy drives and incentives to attract companies to come to Hong Kong. These policy drives included areas related to enhancing research and development, enhancing talent attraction, enhancing talent landing. Put it this way, more specifically on talent landing to also facilitate business networking with other countries and so on.
Chan: So, I might just want you to comment, when you say tailor-made facilitation measures will be a hallmark of what OASES will do to attract the companies.
Yan: Yes.
Chan: What specific support or incentives do you offer these enterprises?
Yan: The fundamental strength of under the “one country, two systems” actually is quite important for attracting overseas strategic enterprises to come to Hong Kong. That is something that we have already for some time. So, on top of that, over the last couple of years, actually, the Hong Kong Special Administrative Region government has developed quite a number of policy incentives to attract these enterprises to come to Hong Kong. Now we have actually over HK$100 billion worth of such incentives to attract them to come to Hong Kong. And these include, when they come to Hong Kong, potential investment that they can get, potential research and development-related subsidy. They also have people, talents coming from overseas, landing in Hong Kong will have different kind of subsidy and attractions to them. There are also quite a number of things related to commercial development outside of Hong Kong or within Hong Kong. So, these are the things, not just for companies in the mainland coming to Hong Kong, but also for overseas companies coming to Hong Kong, use Hong Kong as the base to extend their business in the mainland or in this region. So, these are quite attractive, you know, policy incentives.
Chan: Right, I'm sure. So, do you have any success stories you would like to share with us?
Yan: Absolutely. We have, so far, 66 strategic enterprises already landed in Hong Kong, and each of them actually is a very successful case, and they have their own stories. But if I may pick a few to highlight the key importance of them coming to Hong Kong, using Hong Kong as the base, either to go out of China or to go into the mainland market, we have different cases, like, for example, one company just related to consumer related services, which you probably have also, or some of our audience have already used, like the food ordering and delivering platform, which is a strong AI based platform. When they first come to Hong Kong, they started off with developing an international platform using Hong Kong's international environment, and then they further use Hong Kong as the base to explore, to experiment how this international platform will work, and as a result, becoming one of the leading service providers in Hong Kong. And the third step they use is to actually use Hong Kong as an international training center for them to explore other economies or cities outside of Hong Kong, they are now very successful in the Middle East and other one belt one road cities, yeah. So, these are the things that definitely companies like this one can make use of Hong Kong's advantage. There are also other business-related services or companies. For example, the Hong Kong Airport now adopts technology that uses electronic vehicles, auto drive vehicles to help them transport the luggage and so on. This is again provided by one of these strategic enterprises using Hong Kong's environment, international environment to adapt their platform, and, again, as a result, they are now successful in going to other cities. So, this is Hong Kong's strength.
Chan: Right, Peter. Let's take a short break now and viewers stay with us. We will be right back.
Chan: Thank you for staying with us. Peter Yan, the director-general of OASES, the Office for Attracting Strategic Enterprises, has been sharing with us how his office has been driving strategically important investments to Hong Kong. So, Peter, you have told us about the strength of Hong Kong and the policy incentives that can be offered to the companies. And you have told us some success stories so far. So, are you happy with the results?
Yan: We are very, quite satisfactory with the results so far. Now we have, as I mentioned, 66 companies already landed in Hong Kong. These are all leading enterprises. They are generating basically HK$42 billion investment ...
Chan: Okay.
Yan: … and will be creating 17,000 jobs in Hong Kong.
Chan: Right.
Yan: Some of them, of course, have already started employing additional staff, like one of the companies I mentioned, they grow from 20-something employees to over 200 now.
Chan: Let me ask you, when do you think Hong Kong people will feel this new injection of energy into our community? I mean just now you said it is quite a good result so far. In how many more years do you think we will feel the impact in the community?
Yan: Well, I think the actual impact to the general public probably will take time because a lot of these companies, when they come, they are creating additional jobs which may not have immediate impact on them, unless they are providing services that the general public can enjoy. Like the one that I mentioned, they can see a lot of difference because of that. They may not, however, know that these are the strategic enterprises that we have introduced to Hong Kong.
Chan: I see.
Yan: So, one thing probably, as you said, there are already impact generated by them, but we will, in the coming years – in the coming months, and then definitely years – do more on relating how the strategic enterprises actually has contributed to the daily life, daily economic growth of Hong Kong.
Chan: Right. Peter, we have used the words “strategically important” quite a few times in the interview already.
Yan: Yes.
Chan: So, what criteria do you use to define them, in short?
Yan: Right. Now, these companies will have to be leading enterprises already, quite successful in their own economies or cities.
Chan: I see.
Yan: This is one criteria. Secondly, if they are themselves not sizable enough yet, they have to be in an industry or in an area that is really fast growing, that we can see strong potential for them to grow in a short period of time. And they, of course, like what I mentioned earlier, will be able to generate additional jobs in Hong Kong …
Chan: I see.
Yan: … and additional investment in Hong Kong.
Chan: Right. Peter, you know other Asian countries, such as Singapore and Malaysia, they would also offer enticing incentives to attract enterprises. I am sure that was the reason why I asked you how to define them. I am sure you said they have to be leading in their industry, they could have a name already. I am sure all of them, all the people will be also wanting them as well, even in Shanghai. So, how do you differentiate Hong Kong when you go and pitch with those investors, because you are the actual director-general?
Yan: Well, fundamentally, I think Hong Kong has a strong advantage because of the “one country, two systems” principle, in the sense that we have a very strong hinterland market, the mainland market. And now also with the Greater Bay Area integration, we do have a unique advantage that is the most international city in the Greater Bay Area.
Chan: Okay.
Yan: So, this certainly has attracted a lot of the mainland enterprises who would like to go out to other economies to first start with Hong Kong. Of course, you know Hong Kong has also the advantage of being one of the Chinese cities that, language-wise, culture-wise, we are quite close to the mainland companies. On the other hand, for overseas companies, if they want to approach the mainland market, it is because of the geopolitical situation, actually now they find Hong Kong's position even more prominent, in terms of the first sort of base to land and explore the mainland market.
Chan: Right. So, what you are saying the actual geopolitical tension, in a way, rather than making it more challenging for you, actually in some cases it is even really make it even easier. Can I say that?
Yan: I wouldn't say making it easier, but definitely things will still be quite challenging. But then under the geopolitical challenge, Hong Kong's role as a super-connector or super value adder, has becomes even more prominent.
Chan: I see. Okay. And you also mentioned that many of the enterprises attracted to Hong Kong so far are mainly coming from the mainland, with some from other countries. So, how do you see this situation? Will you see the mainland companies becoming the dominant force in years to come? Or you think there will be gradually more from other countries? And actually, does it matter?
Yan: Right. I think as an international hub, you know, like Hong Kong has always been … it is important that we have both overseas companies and also mainland companies coming to Hong Kong, especially these leading or strategic enterprises. Now among the 66 companies that we have already landed in Hong Kong, now 80 percent of them from the mainland and 20 percent are from overseas. Now this you can say, under the geopolitical situation, is not a bad percentage, in terms of the overseas versus the mainland.
But we certainly would like to see more overseas companies coming to Hong Kong too. So, we will definitely make more effort to attract overseas companies coming to Hong Kong. But at the same time we will have to be realistic that the mainland companies now using Hong Kong as the base to go out for global market is definitely more eager and more enthusiastic.
Chan: Right. Peter, apart from attracting them, I am sure you have to work closely or collaborate with other government agencies or private sector stakeholders to create a business-friendly environment. So, how do you foster this partnership so that it would be, sort of, ensure long-term success?
Yan: Yes, that is a very good point. I think in the past couple of years, we have been focusing very much on attracting companies in that 4 particular technology sectors. So, our resources are focused on those areas, four technology areas. In the last few months we have started, and particularly starting this year we will put more resources in engaging more of the other stakeholders, including research and universities, research institutes and universities, engaging more professional service providers, engaging more investors, the investing community, finance community. And you rightly pointed out the business sector in Hong Kong through associations, chambers, and so on in Hong Kong, to make sure that these companies, when they come to Hong Kong, they can leverage on Hong Kong's network, they can leverage on Hong Kong's research institutes and universities talents, to leverage on Hong Kong's investment funding, and to leverage on Hong Kong's very strong professional services.
Chan: Right. Peter, another area, I am sure the viewers are going to ask you that how do you work with the government in such a way that we balance the need to attract new companies for sure, while we have to be supporting the growth of the existing businesses in Hong Kong?
Yan: Now, as you know, I was previously also, you know, working for some time in establishing a very strong and robust start-up economy, start-up technology ecosystem in Hong Kong. So, this, I think, will be definitely still very much to my heart. And we have very fortunately, in the past few years, successfully established a strong base for local start-up technology companies.
Chan: Okay.
Yan: Now, I think in attracting overseas and also mainland strategic enterprises to Hong Kong, we will just enhance further development of these local enterprises to work with them. So, just now, I mentioned very specifically that we need to engage them with a local commercial organizations, local chambers, local industries, so that we can work together and they can leverage on integrating better their value chain, to have more partnership, leveraging on Hong Kong's already quite strong start-up communities.
Chan: Right. Peter, I mean, you have been in the private sector for 39 years, sorry I have to repeat that again, but you are very kind of a new person to the job, and I am sure you have a lot of drive and vision for the post. How do you see OASES in the next 12 months, in 3 years, in 5 years?
Yan: Right, in the coming year or so or 12 months, I would see OASES actually putting more and more resources on engaging the local communities, as I mentioned, the different stakeholders in the ecosystem, like the universities, like the commercial organizations, the professional services organizations, and the financial community. On top of this, in the coming months, we will be also promoting more about the landing success stories of these strategic enterprises, so that people, like the question you asked earlier, can associate more …
Chan: Okay.
Yan: … with how these companies have actually benefited Hong Kong.
Chan: Right.
Yan: So, these are the things that we will definitely have to focus very much on in the coming months within this year. In the longer term, I would very much like to see us getting even more overseas enterprises to land in Hong Kong.
Chan: Okay.
Yan: The percentage I mentioned is 20-80 now, and I would very much like to see the percentage of overseas enterprises coming to Hong Kong increase, in particular in certain areas that we have strong value-add in. In particular ...
Chan: Peter, I am going to ask you a very last question, a very brief answer. The CE has already mentioned that he wanted you to reach out to over 350 enterprises to get them to come to Hong Kong or consider coming to Hong Kong. How confident are you?
Yan: We are quite confident in achieving that as in the past year, we have already surpassed those KPIs.
Chan: Okay.
Yan: And in the coming years, we will be definitely looking for even higher achievements.
Chan: Right. I am afraid that is all the time we have. And thank you Peter for coming. It has been most encouraging to see what OASES has achieved so far. Attracting strategic enterprises is clearly essential to reinforcing Hong Kong's position as a global hub for innovation and business, while also driving the economic upgrading and transformation of our city. Thank you for joining us and have a good evening!
Yan: Thank you!
